Answered: determined by Select one: a. supply and…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

1. In a market system, prices are determined by

Select one:

a. supply and demand

b. government bureaucrats

c. corporate executives

d. total market demand

2. The price elasticity of demand is 5.0 if a 10 percent increase in the price results in a ____ decrease in the quantity demanded.

Select one:

a. 50 percent

b. 5 percent

c. 10 percent

d. 2 percent

3. A fall in the price of lemons from R10.50 to R9.50 per peck increases the quantity demanded from 19,200 to 20,800 pecks. The price elasticity of demand is____.

Select one:

a. 1.20.

b. 8.00.

c. 0.80.

d. 1.25.

4. A shift of the supply curve of oil raises the price of oil from R9.50 a barrel to R10.50 a barrel and reduces the quantity demanded from 41 million to 39 million barrels a day. The price elasticity of demand for oil is

Select one:

a. 2.0.

b. 0.5.

c. R1 per 2 million barrels a day.

d. 2 million barrels a day per rands.

5. The price elasticity of demand equals ____.

Select one:

a. the change in the price divided by the change in quantity demanded.

b. the percentage change in the quantity demanded divided by the percentage change in the price.

c. the percentage change in the price divided by the percentage change in the quantity demanded.

d. the change in the quantity demanded divided by the change in price.

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